Croatia Makes Notable Advances in AML and CFT Measures, Reports MONEYVAL

Croatia has made substantial progress in strengthening its anti-money laundering (AML) and counter-terrorist financing (CFT) measures, according to a new report from MONEYVAL, the Council of Europe’s AML monitoring body. The findings, outlined in a second follow-up report, address deficiencies identified in a December 2021 mutual evaluation conducted by MONEYVAL.

The latest assessment notes significant improvements in Croatia’s compliance with key recommendations from the Financial Action Task Force (FATF). The advancements cover areas such as risk assessment, national cooperation, sanctions related to terrorism and proliferation financing, new technologies, and international cooperation.

Croatia is now fully compliant with FATF Recommendation 6, which pertains to sanctions for terrorism financing, and Recommendation 7, focused on sanctions for proliferation financing. Other recommendations, including those related to risk-based approaches, the use of statistics, and enforcement of sanctions, have been upgraded from “partially compliant” to “largely compliant.”

Despite these achievements, some areas remain a work in progress. Recommendation 18, which addresses internal controls and foreign branches, continues to be rated as “partially compliant,” although MONEYVAL acknowledged incremental progress in this domain. Additionally, three other recommendations—covering non-profit organizations, transparency of beneficial ownership, and mutual legal assistance—remain “partially compliant” and were not subject to reassessment in this follow-up report.

MONEYVAL emphasized that the evaluation reflects technical compliance but does not assess the practical implementation of these measures. The report indicates that Croatia has achieved compliance or large compliance with 36 of FATF’s 40 recommendations, leaving four rated as “partially compliant.”

Authorities in Croatia are expected to continue their efforts to address these outstanding issues and report further progress to MONEYVAL within the next year.

By fLEXI tEAM